The 10-second takeaway
For the quarter ended Dec. 31 (Q4), W.W. Grainger met expectations on revenues and missed estimates on earnings per share.
Compared to the prior-year quarter, revenue expanded and GAAP earnings per share increased.
Gross margins were steady, operating margins expanded, net margins shrank.
W.W. Grainger reported revenue of $2.23 billion. The 16 analysts polled by S&P Capital IQ predicted revenue of $2.24 billion on the same basis. GAAP reported sales were 7.2% higher than the prior-year quarter's $2.08 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $2.42. The 18 earnings estimates compiled by S&P Capital IQ predicted $2.61 per share. GAAP EPS of $2.17 for Q4 were 6.4% higher than the prior-year quarter's $2.04 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 43.6%, about the same as the prior-year quarter. Operating margin was 11.6%, 50 basis points better than the prior-year quarter. Net margin was 7.0%, 10 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $2.29 billion. On the bottom line, the average EPS estimate is $2.77.
Next year's average estimate for revenue is $9.53 billion. The average EPS estimate is $11.72.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 224 members out of 238 rating the stock outperform, and 14 members rating it underperform. Among 90 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 87 give W.W. Grainger a green thumbs-up, and three give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on W.W. Grainger is outperform, with an average price target of $215.38.
If you're interested in companies like W.W. Grainger, you might want to check out the jaw-dropping technology that's about to put 100 million Chinese factory workers out on the street – and the 3 companies that control it. We'll tell you all about them in "The Future is Made in America." Click here for instant access to this free report.
- Add W.W. Grainger to My Watchlist.
Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.